We are pleased to present the 2012 NAI West Year End Market Report.  2012 was a progressive year for the Utah market and forecasts are strong for 2013.  As always, I welcome your feedback.  Please click the button below for a full copy of the report.

Following a link for the commercial real estate Capital Market Review for December 17, 2012:

Capital Market Review 12-17-12

In terms of interest since our last post there has been a slight decline in rates with office rates dropping below 5%.  December has been the busiest month for CMBS issuance in 5 years which is a good sign for the capital markets.

We have just completed our analysis for the 3rd quarter of 2012.  Please click the link below to see the Q3 Utah Investment Snapshot:

Utah Investment Snapshot – Q3 2012

A few of the highlights from the report are as follows:

• Cap Rates have remained relatively steady over the trailing 12 months with the exception of office properties which has seen a decline.
• The total number of investment property transactions and total transaction volume in Utah has increased for the previous 3 years straight.
• Multi-family properties are the most active segment followed by retail, industrial, and office.

Please feel free to contact me with any questions regarding the market information provided.

Please see the following link for the Capital Market Review for the month of October 2012:

Interest rates remain low across the board with the lowest rates in the multi-family sector.  The 10-year treasury was up a bit due to the unexpected decline in unemployment.  Institutional buyer continue to lead the charge on commercial real estate investment purchasing high-quality assets both in major and more continually secondary markets.

It is interesting to look at how interest rates have moved over the last couple of months.  Across the board rates have continued to drop since May.  Additional lenders have continued to come back into the market.  Underwriting remains strict but there are more sources of financing re-entering the market weekly.

One note in the report that caught my attention was the Fitch Ratings which project that $24 billion of US CMBS loans are set to mature over the next 12 months and of these loans 41% would be unable to refinance (without additional cash) based on Fitch’s defined stressed refinance parameter (DSCR of 1.25, rate of 8%  amortized over 30 years).

It will be important to watch over the coming year how many of these loans default and how many are able to be refinanced.

Please see the following link for the Capital Market Review for the month of August 2012:

NAI West recently completed its Mid-Year Market report detailing the state of the economy in Utah, and more specifically the state of Utah property investment.  A few of the highlights are below:

A few of the highlights of the market report are as follows:

• Utah has the 3rd lowest unemployment rate in the US at 6%.
• Just under $1 MM square feet of industrial spec space has been completed and most of it has been absorbed.
• Overall office vacancy is down to 13.98% with Class A office space at 9.43%.
• Positive retail absorption for the 3rd straight quarter.
• Property investment market remains strong with volumes very similar to the first half of 2011.